Mortgage companies require most people buying a home to purchase home insurance, and for good reason. Your home is likely to be your biggest investment, and it should have adequate coverage in the event of fire, theft, natural disasters or some other emergency.
When shopping for home insurance, keep in mind that there are differing levels of coverage available. You should discuss with your independent agent what is and is not covered, the amount of coverage and deductibles to make sure the policy will be right for you.
Consider the following items that are typically covered under a standard home insurance policy:
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Damage or loss of personal property is covered up to a certain amount. It is important to keep an inventory of your belongings and their estimated value. Depending on the amount of their value, you may wish to purchase additional coverage to make sure you are fully protected.
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Injury or damage to someone else or their property that is caused by someone in your household. This may include incidents that happen outside your property, such as breaking a neighbor’s window.
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If your home needs to be rebuilt, or you cannot live in your home while extensive repairs are being performed, a typical policy will provide money for your family to stay somewhere else until the work is complete. This includes the cost of meals up to a specified daily amount.
Depending on the location and age of your house, you may want to purchase additional insurance coverage for some items that are not covered by a standard policy, including:
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Jewelry, furs, artwork and certain other valuables may need a separate contents policy to be fully protected.
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Common areas of a condo, townhouse or co-op development are typically not covered by an individual home policy. You should make sure the building has insurance for these areas.
The cost of your home insurance policy premium is determined by the amount of coverage it provides, as well as the amount of the deductibles. A $1,000 deductible means that you will have to pay the first $1,000 of a claim before the insurance will begin to pay. It is important for homeowners to have this amount set aside in the event that something unfortunate happens.
Home insurance policies can be tailored to suit your individual needs. When you talk to your insurance agent, it is important to understand what is and is not covered under your policy so there will be no surprises when you need to file a claim.